By Shobha Prabhu Naik & Dan Barnes.
Bloomberg, the financial data provider, has launched a new data service that will take NEX’s BrokerTec US Treasuries data to buy-side firms for the first time. Called the ‘Bloomberg Capital Markets Package (BCMP)’ the data service will represent two large electronic wholesale markets in US Treasuries (UST) and Interest Rate Derivatives (IRD), BrokerTec US Treasuries data and USD Spread-Over data from Tradition’s Trad-X multi-asset-class trading platform.
BCMP is designed to increase market transparency by providing consistent two-way pricing, along with indicators of current tradability, and give the global issuance and derivatives community a way to access, interact with and act upon these data sets.
The new data service will support price discovery in the debt capital markets and hedging strategy development, and Bloomberg expects interest from firms looking to evaluate how to construct financing in the debt capital markets. However it will be distributed via Bloomberg to any user who chooses to subscribe.
Philip Cenatiempo, head of corporate strategy at Bloomberg, says that interest is expected to arise from a broad base of investment firms, asset managers, hedge funds and insurance firms. He said, “Regulators are pushing for objective and verifiable transaction-based data to be used in key benchmarks and reference rates. We believe this service will benefit all market participants equally.”
BCMP will be available via the Bloomberg Terminal and as a data feed. Previously, BrokerTec US Treasury data was available via the Reuters ‘RCM19901’ page on firm’s Eikon product. However Reuters has announced that it will now use data from the Dealerweb service, owned by platform operator Tradeweb, itself part owned by Thomson Reuters, and data from interdealer broker ICAP.
The firms report that this is the first time that Tradeweb’s Dealerweb pricing will be available to the market, delivering pricing from market makers for the RCM 19901 service.
RCM 19901 will offer US Treasury data from Dealerweb’s low-latency central limit order book (CLOB), and USD interest rate swap and multi-currency information sourced from ICAP. RCM 19901 data can be licensed for use through Thomson Reuters financial desktop product Eikon, as well as real-time enterprise feeds or intraday snap shots.
Although Brokertec carries the highest volume of trading for US Treasuries, Thomson Reuters says that using the prices for the smaller proportion of trading seen on Dealerweb will not affect price formation.
A spokesperson says, “Everything trades on a spread to these benchmarks so what happens is the liquidity seeking algorithms arbitrage any pricing differentials which is why all venues essentially carry the same pricing throughout the trading session (for the six benchmarks).”
Jamie Grant, global head of Fixed Income and Enterprise Market Data, Thomson Reuters, says, “All US Treasury order books carry the same level of pricing regardless of volumes in US Treasury Actives, however it is the US Treasury pricing combined with the swap spreads that are most critical for the industry to determine fair value in the rates market.”